EU – Baltic States, Financial Services, Latvia, Legislation, Railways, Transport

The European Commission has set several conditions – the funds will have to be invested in sustainable transport development, with the emphasis on the development of railroad infrastructure, added Dombrovskis, informs LETA.

The Transport Ministry and Finance Ministry will have the mandate to begin the talks with the European Commission, and report on their progress, explained Dombrovskis.

As reported, last week the government did not vote on redistributing the European Union's funds from the failed train procurement for other purposes in the transport sector. The decision was postponed at the request of Reform Party members.

LVL 100 million EU funds was set aside for the train procurement. The Transport Ministry has recommended redistributing the funds for developing the East-West railway corridor's infrastructure, the high-speed railroad project Rail Baltica, airport infrastructure, highways and roads.

According to the ministry's accompanying letter, taking into account that all project activities should be completed by August 31, 2015, an instant decision is required regarding the country's further actions with the EU funds, ensuring that they are fully absorbed.

Under the failed contract, the total cost of new 34 electric trains and seven diesel trains that Pasazieru vilciens wanted to buy was LVL 144, of which LVL 100 million would have been covered from the bloc's Cohesion funds, whereas Pasazieru vilciens co-financing would be LVL 44 million. Together with the train maintenance cost, the contract amount would have reached EUR 610.76 million (LVL 429.24 million), and the new trains would have been manufactured by August 2015.